Legalisation of cannabis cultivation was met with initial excitement in many African countries, such as Malawi, where it offered new economic hopes in a poor agrarian economy that leaves nearly 80% of its population engaged in subsistence agriculture.

A bad situation has been worsened by the decline in global tobacco use – eroding earnings generated by a cash crop on which the country had relied for decades.

Malawi – along with many other countries in southern Africa, including Zimbabwe, Zambia, Lesotho and South Africa – had hopes of becoming one of the major global cannabis markets. But the reasons those dreams have not become reality differ widely.


A ‘glorious day’ leads to years of waiting 


Boniface Kadzamira, a former member of Malawi’s parliament who tabled the bill in 2015 and currently chairs the country’s Cannabis Regulatory Authority (CRA), told the media the day the bill was passed that it was a “very glorious day” for him personally and for the entire nation.

“It is my strong view that cannabis will in the long run replace tobacco to become our major cash crop – that will contribute hugely to the GDP,” Kadzamira said when the bill passed.

Other politicians agreed. The minister of agriculture at the time, Kondwani Nankhumwa, said cannabis legalisation would contribute to Malawi’s economic growth by boosting the country’s export base at a time when tobacco exports were dwindling.

“It is possible to have the bill in effect by the next growing season,” said Nankhumwa. He added that the Ministry of Agriculture, Irrigation and Water Development would set up a section to work with the regulation of the Cannabis Act while waiting for the CRA to be established, which he said could take a few years.

But three years after the bill was passed, just as in other African countries that legalised cannabis cultivation, Malawi is yet to benefit from its cannabis dream. This begs the question whether these countries rushed to legalise a crop that, according to the African Cannabis Report by industry analysts Prohibition Partners, would contribute up to $7.1bn by 2023 across the nine key African countries.

Or perhaps such massive valuations were severe overestimations of the potential of cannabis on the continent, as has been proved in other jurisdictions.


Government funding needed in early stages


In Malawi, where 72 companies and co-operatives registered to cultivate the plant, delays in actualising the industry have been attributed to financial problems, with the CRA short MK2.1bn ($2.1m) to effectively regulate the industry, according to Kadzamira.

Out of the MK2.1bn ($2.1m) the authority needs to effectively operate, Kadzamira said, it was allocated just MK200m ($200,000) in the country’s 2021-2022 budget. He said that in the absence of financial capacity to ably regulate the industry in line with the law, the authority is beyond its regulation powers.

“We need to monitor and inspect the registered companies’ compliance with the law, promote local participation, as well as conduct lab testing at every stage of the value chain,” said Kadzamira. “Being a new industry, there was also a need to sensitise the interested groups to cannabis agronomy.”

He said that if cannabis is to supplement other cash crops, the government needs to adequately fund the authority in the initial stages. Kadzamira added that the other challenge the industry was facing was market linkages.

“We are running into a situation where most will run to grow without understanding what products will be required by their off-takers,” he said.


No clear policy helps derail growth of the sector in Zimbabwe


Zorodzai Maroveke, a Zimbabwean legal cannabis expert, told CannIntelligence that a lack of cannabis legal and regulatory reforms in most African countries, as well as not enough capital and localised expertise making for a huge knowledge gap, were derailing the growth of the cannabis revolution in Africa.

She added that high standards requirements by buyers, along with an existing and unregulated thriving recreational black market, posed a challenge for the growth of the mainstream regulated cannabis market on the continent.

“Despite the assertion by some quarters that many African countries were in a hurry to legalise cannabis cultivation, the countries were rather late,” she said.

“It’s rather the mindset that governments went with, where they thought cannabis cultivation would make billions overnight through heavy taxation without considering the challenges the private sector would face that is currently affecting the growth of the industry. There is need for governments to cushion the emerging cannabis industries for a short period to allow them to have strong foundations.”

According to Maroveke, flexible policies, investment incentives, education and awareness, and research and development would help to accelerate the commercialisation of the medical cannabis and the industrial hemp industries. In the case of Zimbabwe, she said, not having a clear policy was a detrimental factor for the growth of the sector.

“There is a huge disconnect between the government policy and the reality on the global markets,” she said. “As for industrial hemp, the absence of research and development is the major bottleneck for growth of hemp value chains.”

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    In Zambia the roadlbock is sky-high cultivation fees


    While huge cultivation licences have been accused of delayed development of the sector in Zambia, economic expert Daniel Tonga told CannIntelligence that African countries that have legalised cannabis cultivation are failing to achieve their cannabis dreams because of a lack of clear legal frameworks.

    “Some countries are dragging their feet on actualising cannabis cultivation despite legalising cultivation of the crop at the right time,” said Tonga. “What is needed now, for example, is implementation of a proper mechanism for monitoring cultivation to avoid abuse.”

    He said cannabis cultivation licence fees also need to be revised to make them affordable and fair, as they are currently delaying the offsetting of the crop cultivation. And further taxes beyond that will also potentially prove to be a problem.

    “Most are struggling with onerous costs. If taxes are flexible, it can help speed up the growth of the cannabis industry,” said Tonga. Local entities also face challenges posed by foreign investors that have technical advantages and machinery to produce crops at a larger scale, he added.


    Bill back-and-forth keeps South Africa’s dream at bay


    Wandile Sihlobo, chief economist of the Agricultural Business Chamber of South Africa (Agbiz), said that nearly five years have passed since the Constitutional Court ordered the state to amend unconstitutional legislation outlawing possession, cultivation and use of cannabis in 2018, but the Cannabis for Private Purposes Bill is yet to be passed by Parliament, two years after it was introduced.

    “The bill has repeatedly been sent back from Parliament for, among other things, continuing to criminalise possession of large amounts of cannabis,” said Sihlobo.

    He said that while the court gave Parliament 24 months to amend the affected legislation, creating an opportunity for South Africa to legalise and regulate the existing underground industry and to introduce a framework for a medical and recreational cannabis industry in line with international standards, the South African cannabis dream continues to languish in the pipeline.

    This, he added, was despite South African president Cyril Ramaphosa assuring industry players in his 2020 state of the nation address that the country would open up and regulate the commercial use of hemp products, provide opportunities for small-scale farmers, and formulate policy on the use of cannabis products for medicinal purposes to build this industry in line with global trends.


    Finding encouragement along the rocky road


    While several cannabis industry lobby groups are preparing to go back to the constitutional court to have the prohibition on dealing in cannabis declared unconstitutional and to have the police interdicted from carrying out any further arrests for cannabis until the legal situation is addressed, Sihlobo said South Africa still has a tough road to walk in formulating the proper regulatory system for the entire cannabis value chain.

    “The encouraging part, however, is that various government departments are considering this plant for the master plans that are being drafted, with the hope of stimulating growth of the industry,” he said.

    Sihlobo gave the example of a report from New Frontier Data (an organisation that produces studies and industry reports covering a variety of cannabis industry topics globally) that outlined nine foundational pillars for establishing a stable and healthy development of a new legal cannabis market in South Africa – policy development, regulation, taxation he said South Africa’s finance minister is very keen on, compliance, lab testing, data and reporting, cultivation, extraction and processing, and education.

    “The New Frontier Data report cautions that ‘policymakers and regulators who fail to recognise or fully appreciate the whys and hows for establishing the fundamental elements can not only slow down the development or maturation of a legal cannabis market but ultimately lead to unintended consequences and undesired results, defeating the very purposes of reform and legalisation in the first place’,” said Sihlobo.


    Working together could be the key


    Meanwhile in Malawi, cannabis grower Invegrow says despite the delay in actualising cannabis cultivation in the country, all is not lost. The company’s founder and managing director, Tanya Clarke, told CannIntelligence that Invegrow has already started production of cannabis products which it is selling in the local and international markets.

    She said there was, however, a need to make cannabis regulation uniform across the African countries that have legalised cannabis cultivation.

    “The slowdown has been more to do with emotional feelings with cannabis,” said Clarke. “When it comes to cannabis, many African countries are nervous with the prospect of legalising the plant. Yes, we need to protect society, but we can always learn from other countries’ legislation.”

    She said African countries would also greatly benefit if they sold cannabis products among themselves.

    – Madalitso Wills Kateta CannIntelligence contributing writer

    Photo: Tatenda Mapigoti

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    This article was written by one of CannIntelligence’s international correspondents. We currently employ more than 40 reporters around the world to cover individual cannabis and cannabinoid markets. For a full list, please see our Who We Are page.